DWF advises Whitbread on £200m London hotel duo deal

Legal business DWF has advised Whitbread, the UK’s largest hotel, restaurant and coffee shop operator, on a pair of forward funding deals in London valued at over £200m combined. 

The two transactions, a 339 room hub by Premier Inn in Westminster with M&G and 326 room Premier Inn in Farringdon with Aviva, completed in the final week of 2016 at an initial yield of 4% and are part of Whitbread’s property strategy to continue to carry out sale and leaseback transactions in the UK and Germany. 

The deals follow shortly from the completion of Whitbread’s first forward funding deal for its hub by Premier Inn hotel chain, a 389 room hotel in Kings Cross worth £85m on which DWF also advised. Real estate partners Melanie Williams and Paul Inman led the team on all transactions with support from tax partner Jon Stevens and construction director Shaun Hill. 

DWF’s national real estate team has supported the hospitality giant in building its Premier Inn brand across the country having previously advised the company on its purchase of two prime Westminster sites in 2015 and advising on its first nine sites for its hub by Premier Inn hotels in 2014.  

Melanie Williams DWF Head of Hospitality, said: “It’s been a pleasure to work with Whitbread once again on two significant hotel transactions after what has been quite a turbulent and uncertain year in the real estate industry. The deals demonstrate DWF’s expertise in the hotel sector as well as the team’s ability to handle multiple complex transactions efficiently and to a high standard and we look forward to furthering our long-standing relationship with Whitbread in 2017.” 

Mark Anderson, Managing Director, Property and Premier Inn International at Whitbread said: “Tothill Street and West Smithfield are fantastic freehold sites in prime London locations, across two popular and proven hotel formats, and the quality of the assets has been reflected in quality deals with these respective funding partners. As we target growth to 85,000 bedrooms across the estate by 2020, securing two high-value forward funding deals in rapid succession will release capital for further investment and unlock new opportunities for expansion. Premier Inn is a strong growth business, backed by the Whitbread covenant, and recycling capital from property is a key strand of our strategy, and showcases our commitment to active management of our portfolio.” 

Melanie Williams

Partner - Head of Hospitality Group

I am Head of the Hospitality sector group as well as a Partner in the Real Estate team, working from both the Birmingham and London offices.